Under the Montgomery County Depositor Foreclosure Program, a citizen may submit a $2000 refundable deposit to the County Treasurer to initiate judicial foreclosure proceedings. The property then goes to auction where you have a chance to buy it.

As South Parkers know, it’s not just frustrating to see a historic house fall to ruin, it’s potentially dangerous. Vacant and abandoned properties often attract crime, trash, arson, and depress the surrounding property values.

Montgomery County Depositor Foreclosure program

Let’s say you’ve got your eye on a particular home that you want to rescue from abandonment but can’t reach the owner to make an offer. Or you may want to ask that they put a For Sale sign out front so someone can buy and renovate it.

The Depositor Foreclosure program may work for you. It’s a citizen-initiated process that “takes the property to court” for not paying county taxes, allowing the County to take title and send the home to the county Sheriff’s auction (a foreclosure sale). Then you and all interested parties can bid competitively on the house. Money from the sale covers the unpaid taxes. And the house finally gets a new owner.

A four-step process: 1-Research, 2-Apply, 3-Allow time for court action, 4-Attend auction

Here’s how you can use this step-by-step process to acquire a vacant/abandoned residence and make it livable once again.

1-Research and confirm the property is eligible

Some homes in South Park may be tax delinquent and not be known to the County Treasurer’s office. With the address of the abandoned house, search the online Montgomery County records for tax delinquency data. It‘s important to thoroughly research a property. Tax liens, bankruptcies, court cases and delinquent payment plans attached to a property have implications on foreclosure eligibility.

Here is a downloadable PowerPoint deck that takes you step-by-step through your online search. MCHowtoSearchDelinquencies

Once you find it, and see that taxes are still unpaid, contact the Delinquency Department at the Treasurer’s Office 937-225-4010. They’ll confirm whether the parcel is already slated for foreclosure or if you may initiate one.

2-Submit application and $2K deposit per property to the County Treasurer

To initiate a residential foreclosure, go to the County’s website and download an application. Your $2000 deposit covers the administrative cost of the foreclosure case and will be refunded to you once the property is sold.

By rule, your name is shielded from the public record and the foreclosure is requested in the Treasurer’s name.

Once the case is filed with the court, the Treasurer mails you a case number so that you may follow the case online.

3-Wait 9-12 months for the administrative process to unfold

After review, the County submits the foreclosure as a court case (known as a judicial foreclosure).

Keep in mind, the property owner is notified of these proceedings. They have the right to pay off delinquent taxes and fees at any time and thus retain ownership, all the way until the final auction process. If that happens, the Treasurer will refund your deposit.

Sometimes a property cannot be sold due to a finding in the title work, such as a financial encumbrance or defect in the chain of ownership. If the attorney discovers such errors, you’ll be refunded the deposit minus the cost of the title fees incurred during their search.

4-Attend the auction – win or lose, your deposit is refunded

Following the court case, the property will be listed as a “Treasurer’s Tax Sale” through the Montgomery County Sheriff’s Office.

Auctions occur at 10am on the first Thursday of every month in the lower-level auditorium of the Montgomery County Administration Building (451 W. Third Street). You must attend in person.

The successful bidder deposits $1,000.00 plus fees immediately following the sale. Arrive with your ID, and either cash, certified check or a personal check from a local bank to be signed in the presence of the auction staff. Pay the balance by certified or cashier’s check within 15 days of the date the Confirmation of Sale is filed. All deeds are filed within 14 days of receipt of your final payment.

Be prepared to invest!

When you buy a foreclosed property, you’re buying it “as-is” and may not be allowed an interior viewing.

This means that you’re responsible for all repairs that need to be made. There may be extensive damage caused by weather, people or animals. In worst cases, a new owner lets the house continue to stand empty and unrepaired for lack of funds to fix it.

Seriously weigh the sense of satisfaction from buying and renovating an “orphan” home versus the work and money put into it. Ask around, and we’re sure you’ll find neighbors who’ve successfully brought a blighted property back to life and can give you first-hand advice.

Once in good repair, you may decide to sell it to a new South Park family or register it as a rental. Either way, if you know the extent of the task you’re taking on and succeed, the entire neighborhood benefits.

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